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June 2001
Premier Oil’s release of a Social Report detailing the impact
its gas pipeline has had on local communities in Burma and on other
key stakeholders, comes at the end of a decade of controversy for
the company. The company’s operation in Burma has met criticism
from the outset, since it’s initial deal with Burma’s military
junta in 1990, and subsequent human rights abuses by military personnel
securing the pipeline area. Burma’s pro-democracy leader Aung
San Suu Kyi, the UK government and human rights groups have all called
on the company to end its support for the dictatorship and withdraw
from Burma.
Premier has now produced a Social Report which aims to ascertain the
impact the company has had in Burma, as well as to map out a way of
monitoring practice in the future in order to ensure net benefits
to local communities. The report hopes to meet its objectives through
a process of stakeholder engagement, but crucially fails to speak
to those most affected by the company’s investment – those
who have experienced human rights abuse. EQ Management, the consultancy
employed to undertake the report, has no experience of reporting on
an operation such as Premier’s and has attempted to use a methodology
which has significant flaws. This undermines the report more generally.
The fundamental concerns that Premier’s involvement in Burma
raises are unlikely to be dealt with in EQ’s report. These concerns
would include the plight of those that have suffered abuse at the
hands of troops ‘protecting’ the pipeline, the absence of
any vetting procedure ensuring officers accused of human rights abuses
are not employed in the pipeline area, the likely use of revenue created
by the project for the junta’s military spending and the absence
of any evidence that human rights training paid for by Premier will
change anything for ordinary Burmese under the current regime.
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2. premier and the junta: destructive
engagement
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Burma’s military dictatorship
Burma is a country ruled by one of the longest running and most
brutal military dictatorships in the world; a dictatorship charged
by the United Nation’s International Labour Organisation with
a “crime against humanity” for its systematic abuses of
human rights, and condemned internationally for refusing to transfer
power to the legally elected Government of the country – the
Party led by Nobel Peace Laureate Aung San Suu Kyi. Burma’s military
regime is responsible for:
• Around 8 million men, women and children in forced labour often
imposed with the threat of physical abuse, torture, rape and murder.
• One and half million internally displaced people, in part the
result of ethnic cleansing campaigns against minority groups.
• The detention of at least 1700 political prisoners, many of
whom are routinely tortured.
• More child soldiers than any other country in the world.
• The refusal to transfer power to Aung San Suu Kyi’s party,
the National League for Democracy, elected to Government in 1990.
• Thousands of refugees who have fled to Thailand, China, India
and Bangladesh.
• The production of illegal opium and heroin
• One of the largest armies in Asia despite having no external
enemies.
• Reducing what was once one of the richest countries in Asia
to one of the world’s poorest.
• The closure of Burma’s universities for most of the last
decade in an attempt to prevent civil unrest. A whole generation’s
education and opportunity has been lost.
Premier engages
Premier became the first oil company to sign an exploration deal with
Burma’s military for the exploration of the Yetagun offshore
gas field in May 1990. It’s partners comprise Petronas of Malaysia,
Nippon of Japan, the Petroleum Authority of Thailand (PTT) and the
regime's own oil and gas company the Myanmar Oil and Gas Enterprise,
(MOGE). Premier’s share in the consortium is 26.67%. A $650 million
capital investment was required to finance the project and the gas
started flowing in May 2000. It is estimated the field will continue
to produce gas for at least 20 years. UK energy consultants, Wood
Mackenzie, have estimated that Burma's earnings from Premier’s
Yetagun field will be around $823 million through to 2025.
Yetagun is the second gas field to start extracting gas in Burma -
the Unocal/Total consortium’s Yadana field being the first. Construction
of both pipelines is now complete and both projects share a common
gas buyer, the Petroleum Authority of Thailand.
Both the Yetagun and Yadana projects have been plagued by human
rights controversy. In March 2001, Fifteen Burmese citizens who
claim their human rights were violated by the construction of Unocal's
pipeline, defeated Unocal's attempt to remove their cases from the
California State Court.
Premier has tried to defend its Yetagun pipeline on the basis that
it was built after Unocal/Total’s and that many of the accusations
of abuses relate specifically to Unocal/Total’s Yadana project.
However, Premier’s own literature clearly states that it has
benefited from Yadana infrastructure, and therefore Premier is clearly
associated with the human rights abuses linked to the Yadana pipeline:
“Considerable infrastructure, comprising airstrip, jetty and
various roads and bridges, is required to support onshore pipeline
operations in the remote Taninthayi region of Southern Myanmar.
This infrastructure was originally built by Total Fina on behalf
of the Yadana Joint Venture partners.” The company’s statement
continues: “The Yetagun onshore pipeline runs parallel to the
Yadana onshore pipeline for much of its length. Thus, Premier Oil
and TotalFina… have agreed to share the cost of this infrastructure
and operate it for the mutual benefit of both the Yetagun and Yadana
fields” .
Terror in the pipeline
After Premier and other foreign oil companies signed contracts with
Burma’s military in the early 1990s life changed dramatically
for the people who inhabit what has become known as the pipeline
region. The area had been inhabited by fishing communities, farmers
and plantation owners. Troops might move through villages occasionally
but would not remain. The Yetagun impact assessment, produced for
Premier and other consortium members, predicted “the pipeline
will create a major security role for the army.” This prediction
was tragically realised; an area with no significant or permanent
Burmese military presence was suddenly flooded with troops to make
it safe, and therefore attractive for international oil companies
such as Premier, Total and Unocal.
The new battalions needed barracks and one of the first orders to
villagers was to build them. Thousands were forced to build the
first major barracks in Kaleinaung. The Yetagun impact assessment
observed: “Military housing and local infrastructure is provided
by underpaid or unpaid labour. The harsh conditions of those carrying
out such labour – including young children – and the testimony
of local people who will go to extremes to avoid it, belie the government
claim that such work is voluntary.”
A French Parliamentary delegation concluded after visiting the pipeline
area in 1999 that: “the link between the military presence,
the acts of violence against the populations and the forced labour
is established as a fact. Total had to be aware of that”. As
mentioned before, Premier uses the same infrastructure.
Documentation of human rights abuses in the pipeline region has
been rigorous. Since 1995, the field staff of Thailand based EarthRights
International (ERI) have been travelling at great risk on both sides
of the Thai-Burma border to document the conditions in the pipeline
corridor. They have collected first hand testimonies from several
hundred victims, witnesses and army defectors interviewed from the
pipeline corridor. These testimonies were collected and translated
in literally hundreds of hours of interviews by EarthRights International
field personnel between 1995 and 2000. Interviewees testify to a
range of abuses including forced labour, torture and rape.
Indeed Amnesty International released a report in June 2001, documenting
serious human rights abuses committed by two Light Infantry Battalions
(LIBs) who provide pipeline security. LIB 273 and 282 are two such
battalions. Amnesty reports the testimony of one villager abused
by ten soldiers from LIB 273, “I was tied with a rope…beaten
on my back, hit with a rifle butt and cane stick…I was forced
to lie on my stomach while they put two wooden rods on my back while
a soldier stood on each side of the rods. They dug a hole and put
me in it… I was kept under the hot sun all day…”
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Premier’s response
The Burma Campaign UK has met with senior staff at Premier on numerous
occasions over the last three years. Until last year Premier had
never admitted to the campaign that it was aware of any abuses in
the pipeline area. However, prior to the company’s Annual General
Meeting in 2000, the impact assessment for the pipeline project
(previously mentioned) was leaked. This document had warned of potential
abuses if the pipeline project was to proceed. Only then did Premier
Chief Executive Charles Jamieson admit that the company had been,
“aware or been made aware of some instances of abuses against
the local population or the environment”. He continued, “These
incidents have been rare, perhaps three or four each year, but are
immediately taken up with the state oil company MOGE and the appropriate
authorities in Yangon, and action is taken.”
The initial denials and the subsequent admittance did not inspire
confidence amongst human rights activists that Premier was fully
committed to uncovering the full impact of its operations in Burma.
Neither did the naïve reliance on the regimes own agencies
to act on alleged human rights abuses provide any confidence that
the company understood what political context it was working in.
Human Rights Watch (HRW) has stated that it is not aware of a single
case in which a Burmese official has been sanctioned for disobeying
the regimes own order prohibiting forced labour. The agency adds
that without a sustained effort that includes highly publicised
prosecutions of those who disobey the order, the ban on forced labour
will remain nothing more than a public relations effort. Sydney
Jones of HRW says, “The international community should keep
up the pressure, and until all forced labour is ended and this has
been independently verified, foreign companies should refrain from
investing in Burma”.
Premier has been unable to provide assurances that abuses are not
committed by Burmese troops who have a security role for their pipeline
or any clear examples of appropriate action taken.
Premier’s critics
For the reasons above, as well as for all of the ways its investment
has supported the dictatorship, the company has had significant
critics. Aung San Suu Kyi, Burma’s pro-democracy leader and
Nobel laureate has said, “Premier Oil is not only supporting
this military government financially, it is also giving it moral
support, and it is doing a great disservice to the cause of democracy.
It should be ashamed of itself”.
Former Foreign Secretary Robin Cook has said, “I’m going
to make it quite clear, we do not approve of what Premier are doing,
they know that perfectly well, we would much rather they stopped
and they know that perfectly well”. Foreign minister John Battle
has also called on Premier to pull out of Burma saying: “I
really expect Premier to do the decent thing without having to resort
to legal pressure”.
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3. eq management’s social report
– corporate spin?
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As a response to criticism of its involvement with Burma's military,
and in an attempt to deliver on Premier's corporate responsibility
principles, the company commissioned EQ Management to carry out a
social audit.
A social audit is a measure of performance, which assesses an organisation's
social, economic and environmental impact. EQ's Social Audit of Premier's
Burmese operation uses a method of collecting data known as stakeholder
engagement. EQ attempted to use Accountability 1000 (AA1000) standards
which provide a framework for those seeking to measure how companies
integrate social, economic and environmental performance. AA1000 specifies
a process that requires extensive stakeholder dialogue and reporting
but offers no criteria for what is responsible corporate performance.
Indeed, Burma Campaign believes the AA1000 framework cannot be adequately
deployed in the specific political and social context that is present
in Burma, and therefore cannot deliver an adequate account of the
social impacts of Premier's Burmese operations.
An inadequate methodology
It is telling that the Social Performance Report itself says that
EQ’s approach: “involves simplifying the ethical issues
at stake and the establishing manageable methodologies and systems
for measuring, reporting and improving ethical and social performance.”
EQ Management's methodology fails to include critical stakeholders
impacted by Premier's operations in Burma; it fails to overcome the
enormous challenges of undertaking genuine and meaningful stakeholder
engagement within the current Burmese context. With such fundamental
flaws the Burma Campaign can only raise serious doubts about Premier’s
real intentions. The exercise appears to be more about corporate spin
than true, transparent and honest stakeholder engagement.
1. Stakeholders: EQ failed to apply the AA1000 methodology
effectively as they did not account for the practical reality of current
life in Burma. The current Burmese political and social environment
is such that it does not "allow stakeholders to accurately and
fully express their aspirations and needs."
Years of dictatorship, increased militarisation and one of the world’s
most pervasive networks of informers and military intelligence have
silenced communities in Burma. Christina Fink, an anthropologist looking
at this problem says: “Community life has been warped by military
rule… people do not trust each other and cannot converse freely,
even in their own neighbourhoods. So many people in Burma talk of
living in silence and speaking in whispers.” A Burmese writer
put it “We have no mouths, only ears.”
Warwick Business School (WBS) who were given the task of verifying
EQ’s reporting process say in the final report: “…given
the acknowledged repression of critical political comment in Myanmar
(Burma), the verifier is concerned that community members wanting
to address negative issues relating to Premier Oil’s national
political impact, and/or the ramifications that this might have at
the local level, will feel restricted.” They continue: “In
the present political environment this unavoidably compromises the
ability of Premier Oil’s community stakeholders to be fully expressive…”
WBS is also concerned that these restrictions could apply to Burmese
employees of Premier.
WBS have identified other flaws in EQ’s process: “EQ spent
less than one full day consulting local community members, clearly
insufficient time to identify a representative range of indicators
and issues when there are in excess of ten villages impacted by Premier
Oil’s operations.”
2. Refugees: If it was possible to engage with the key stakeholders
there would be significant reporting of the pervasive human rights
abuses that have been carried out by Premier's business partner -
the Burmese military. There would also be specific mention of human
rights abuses occurring currently in the pipeline region.
The original inhabitants of the pipeline area who have fled to
Thailand as a result of persecution by pipeline ‘security forces’
are not included in this stage of the audit. Premier now implicitly
accepts that these refugees exists: “We have not included displaced
groups in this first pilot round of stakeholder consultation, but
we plan to consult these groups in the next cycle of social auditing.”
Though the impact of the project has had the most dramatic impact
on these people, they have been relegated to the next phase of the
reporting process. Such a failure to include these stakeholders
from the very beginning can only lead one to the conclusion put
by Adams and Carol that when reporting on ethical issues, “it
is particularly clear that, in selecting what to report, most companies
are more concerned with their image than with a genuine desire to
be accountable.”
It should also be noted that two well established NGOs working for
refugees in Thailand were willing to facilitate meetings between
EQ and displaced communities. The offer was not taken up by EQ.
3. Expertise: In the case of Premier Oil and Burma there
is a context of fundamental human rights abuse. An adequate canvassing
of information and opinion in such a context can only be done by
investigative experts in the field of human rights.
EarthRights International has developed such a methodology but it
can only be implemented using techniques which circumvent all possible
influence from the military, or its intelligence services. The methodology
necessitates great risks to the field staff who cross from Thailand
into Burma to undertake their investigations. All field staff speak
the languages of the communities in the Tenasserim division. These
are all skills and methods not apparently possessed by EQ management.
The consultations with communities along the pipeline area undertaken
by Compass Research, will not have overcome the fundamental problems
of stakeholder engagement in a Burmese context.
EQ's previous clients include the New Economics Foundation, the
Department of Social Security, Waitrose and a fabric company (Renuka)
based in India. The operating contexts for these companies are a
world away from an oil and gas company that is working with one
of the world's most brutal dictatorships, a gas pipeline crossing
sensitive territory inhabited by minority peoples, the militarisation
of this territory resulting in gross human rights abuses, and where
a key stakeholder group (original inhabitants of the pipeline area)
live as refugees in neighbouring Thailand.
Human rights training
Premier Oil is involved in a project to provide human rights training
for officials of the regime. Referring to the training, a representative
of Burma’s exiled government in Washington quoted a Burmese
proverb, “It is more difficult to wake someone who is pretending
to be asleep”. The regime is fully aware of its legal obligations.
Human rights abuses are not being committed through a lack of understanding
of human rights law, but as an instrument of maintaining power.
Premier has sponsored a series of human rights seminars. The seminars
have been organised by the Australians and overseen by the Australian
Human Rights Commissioner, Chris Sidoti. He met last year with regime
officials including the Minister for Home Affairs who gave consent
for the project to proceed. Premier’s training started in February
in Rangoon. The seminars, aim to “disseminate International
Human and Humanitarian Rights information and to assist the Government
of Myanmar in the creation of a Human Rights Body” .
According to Sidoti, there were three action points resulting from
his talks with the regime:
- On the question of an independent national human rights institution,
Australia will provide more information and the Burmese government
will consider establishing such an institution.
- Australia will provide examples of possible curricula and processes
for human rights training and will also explore the provision
of such training to the military.
- On the question of a joint health project, Australia will develop
project proposals.
Joseph Silverstein, Emeritus Professor of Rutgers University, has
put forward a number of key problems with the programme:
1. How do Sidoti and the regime interpret the word independent in
the context of a country ruled by a dictatorship? Is there any basis
for believing that the military rulers of Burma are ready to create
an agency with power and authority to carry out a mandate to restore
and protect human rights, without interference from the junta who
will have to establish it?
2. Will the human rights commission have powers to act against the
authorities with the backing of law and courts?
3. Will the commission have funds which it can use to conduct its
affairs and act free of interference from the military rulers.
If all of these conditions were in place they would constitute
a real independence. However, Silverstein suggests that the situation
in Burma currently precludes such independence: “There is no
authority other than the dictatorship. There is no rule of law.
There is no freedom of speech. There is no freedom of assembly.
There is no freedom of mobility. There is no security of one's life,
labor, home and family.”
“In this environment, which is well-known to the world through
the reports of the special rapporteurs of the UN Human Rights Commission,
the resolutions of the UN General Assembly, the reports on human
rights by the nations of the world which have followed events inside
of Burma, the report of the International Labor Organization on
forced labor and the observations of diplomats living inside of
Burma, it is hard to understand what Sidoti learned from his short
visit to cause him to write in his report: ‘I can say at the
end of this visit ... that an exchange of views on human rights
has begun where none existed before; that we have been able to identify
some areas in which cooperation may be possible and that there is
evidently a strong commitment to taking the process further’.”
Premier says in its booklet on responsible business, that it is committed
to the principle of “prior assessment to assess the social, economic,
health, human rights and environmental impacts of any new activity
or project, both prior to its commencement and before decommissioning
a facility or leaving a site.” However, an impact assessment
was carried out for Premier’s consortium by Le Provost Dames
before the pipeline’s construction had started. The assessment
made clear that: “The use of local people in forced labour, and
atrocities against these people and any others suspected of links
to the insurgents [were] well documented by Amnesty International,
the United Nations and Human Rights Watch/Asia”. And continued:
“It needs to be recognised…that the local people have been
and probably will continue to be subject to heavy levies of money
and food from the military.” adding: “[An] immediate issue
for the project is the fact that military security will not only need
to be maintained at its current levels, but will have to be increased
or relocated to enable the pipeline to be built. There is a potential
for any continuation of the past harsh policies of the army to be
blamed on companies involved in the project”. This analysis and
warning did not stop the companies from pushing through with their
project.
As for the Social Report, it neglects to give voice to those who have
suffered most; those who have felt the full impact, as the interests
of multinationals and a brutal dictatorship coalesce in pursuit of
resources and profit.
Any social report, and any recommendations it provides will have to
be judged by what it says about past impact and future action. This
report is likely to fail on both counts in relation to Premier’s
operational area and its relationship with the regime.
It is absolutely vital that issues concerning Premier’s wider
responsibilities be addressed. These include: the pipeline revenue
which buttresses the regime, the plight of refugees who have fled
the pipeline area, and the continuing military occupation of the
pipeline area and the abuses that take place as a consequence. Ultimately
the company has to ask itself in what political context would it
consider it inappropriate to proceed with investment – where
does it draw the line?
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